Will licenses to grow and sell medical marijuana in Missouri go to the highest bidder?
Medical marijuana isn’t even legally available yet in Missouri, and questions already are emerging about the prospect of permits to grow and sell cannabis going to the highest bidder.
After Missouri voters overwhelmingly approved the use of medical marijuana in 2018, the state implemented a competitive application process to award a limited number of cultivation and dispensary licenses.
But when the state announced 192 licenses for dispensaries had been awarded from among 1,163 applicants, complaints and lawsuits about the selection process quickly multiplied. Businesses that came out on the losing end have raised concerns about the scoring system and the private company that evaluated the applications.
And now, a new wrinkle in this system: Some of the winners of the permits are actually looking to sell their coveted licenses. And that’s permissible.
The buying and selling of permits is legal, said Lisa Cox, a spokeswoman for the state’s Department of Health and Senior Services.
“We obviously have to approve it,” Cox told The Star Editorial Board. “They just can’t transfer it.”
The operator of California-based GreenVision, a cannabis investment bank and consulting firm, asked an unidentified applicant who was denied a Missouri cultivation permit if they were interested in purchasing a license from one of the winners, the St. Louis Post Dispatch reported. And online brokers are looking to help buyers find licenses in any of several states where marijuana is legal.
In Missouri, where medical marijuana sales are expected to start this summer, the option to sell licenses raises new questions about the application process and the limit on permits. What’s the point of subjecting applicants to an exhaustive evaluation if a license holder can then put the permit up for sale?
Administrators of Missouri’s medical marijuana program should reconsider some of the rules and regulations that have proved effective in other states. There is no limit on the number of licenses issued in Oklahoma, said Terri Watkins, a spokeswoman for the state’s medical marijuana authority. The state has approved close to 4,000 pot growers.
Missourians don’t want cultivation centers or dispensaries on every street corner. But the state’s first go-round of awarding licenses has revealed serious flaws in a system that severely limits the number of permits awarded. A free and open market for businesses that are deemed qualified would ease concerns about the current evaluation process and curtail the possibility of questionable deals being done on the resale market.
The state’s administrative hearing commission could choose to approve more licenses. But, “that’s not really the plan right now,” Cox said.
Opening the marketplace should be a priority, said Dan Viets, formerly of New Approach Missouri, which helped write the constitutional amendment that cleared the way for medical marijuana in Missouri.
“The only limit is the one (the health department) imposes itself,” Viets said. “They can issue as many licenses as they want.”
Owners of one medical marijuana-based business argue in a lawsuit that the state’s limit on cultivation licenses violates the Missouri Constitution’s right to farm.
“There should be free and open competition,” Viets said. “That is in the best interest of patients.”